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In the past year, most of the reported appellate cases addressing the economic issues related to separation and divorce fall in only a few categories. Two cases addressed retroactive support and counsel fee awards in support case; the most important is Krebs v. Krebs on the duty to disclose income changes. Two important cases issued regarding reasonable and necessary expenses as they relate to Melzer v. Witzberger, 445 A.2d 199, (Pa.Super. 1982). We now have recommended changes to the Support Guidelines, which propose to make Melzer obsolete. The new Guidelines will raise the bar, as the families with combined monthly net income up to $30,000 will all be “on the chart”.
There are two special categories of support cases which have been appealed repeatedly: the issue of emancipation of a child over age 18; and identification of paternity and the related support obligation. There are two cases that will help us in specific circumstances: the treatment of a personal injury award proceeds in Faust v. Walker and the right of a custodian to receive child support, when the recipient should not have had custody, JF v. DB.
The comment period on the proposed amendments to the Support Guidelines is due to close October 31, 2008. Keep in touch with your family law practitioners. If the Guideline revisions are quickly approved by the Supreme Court, they may be the rule of the land by early 2009.
I. RETROACTIVE SUPPORT; COUNSEL FEES
Krebs v. Krebs, 944 A.2d 768, (Pa.Super. 2008), decided March 5, 2008.
In this important decision, the Superior Court addressed the affirmative responsibility of an obligor (here the father) to disclose change of income. The last support order had been issued in April, 1998. In April, 2006, mother filed a petition to modify. The Trial Court noted that mother failed to avail herself of the automatic right to seek a review three years after the order was entered, i.e. in 2001. (In some counties, that review is triggered by the Domestic Relations Office itself.) The Trial Court decided it was fair to order some retroactivity, but only went back two years to 2004. On appeal, the Superior Court reversed and found that the Trial Court had imposed an unreasonable burden on the custodial parent. In addition, the Appellate Court felt it was appropriate for the lower court to reconsider the request for an award of counsel fees pursuant to 23 Pa.C.S. §4351.
§4351. Costs and fees.
(a) General rule.–-If an obligee prevails in a proceeding to establish paternity or to obtain a support order, the court may assess against the obligor filing fees, reasonable attorney fees and necessary travel and other reasonable costs and expenses incurred by the obligee and the obligee’s witnesses. Attorney fees may be taxed as costs and shall be ordered to be paid directly to the attorney, who may enforce the order in the attorney’s own name. Payment of support owed to the obligee shall have priority over fees, costs and expenses.
[(a.1) omitted]
(b) Lack of good cause for failure to pay on time.–-If the court determines that the person subject to a child support order did not have good cause for failing to make child support payments on time, it may further assess costs and reasonable attorney fees incurred by the party seeking to enforce the order.
1997 Amendement. Act 58 amended this sec.
Sirio v. Sirio, 951 A.2d 1188, (Pa.Super. 2008), decided June 24, 2008.
See the discussion below under II. Reasonable and Necessary Expenses. Retroactive disclosure of income was addressed, as well as a claim for counsel fees.
II. REASONABLE AND NECESSARY EXPENSES
Bulgarelli v. Bulgarelli, 934 A.2d 107, (Pa.Super. 2007), decided September 27, 2007.
In the instant case, the parties qualified for Melzer because the combined monthly net income was higher than $20,000. The payor-father argued that the Trial Court committed error by failing to calculate the presumptive minimum as provided in the Rules. Father argued that the presumptive minimum, which would be the child support obligation at the $20,000 Guideline level, would demonstrate that the amount awarded, significantly higher than the presumptive minimum amount, was patently unfair. Father argued that, considering 50/50 physical custody, the reasonable needs should not be significantly greater than the presumptive minimum Guideline award. Father disputed the division of household expenses by counting heads, particularly since the children were at mother’s home half the time. The Superior Court found that the Trial Court provided a well-reasoned justification for accepting the allocation of household expenses. The Superior Court found that the failure to calculate the presumptive minimum guideline support was a harmless error because the Trial Court properly addressed the needs, expenses and standard of living. The legitimacy of certain line items was considered, and on appeal, it was specifically noted that charitable contributions could be a legitimate budgeted item. This issue was remanded. The Appellate Court did not find the order was too high simply because it was dramatically greater than the presumptive minimum award.
Sirio v. Sirio, 951 A.2d 1188, (Pa.Super. 2008), decided June 24, 2008.
Again, the Melzer support calculation was significantly more than the presumptive minimum amount, and the Superior Court agreed to remand for a closer analysis of the reasonable expenses. The Master had made an observation that mother’s budget was not out of line compared with father’s budget. This overlooked the fact that father listed as one of his budgeted expenses his current child support payment. After deducting that from father’s budget, there was a significant difference in the two parents’ budgets. The Superior Court directed the Trial Court to review and adjust some of the line items. For example, mother included capital expenditures, and the Superior Court noted that those did not recur each year and must be amortized over a longer time. The Superior Court did acknowledge, as it had in Bulgarelli that the 50/50 custody arrangement did not cancel or change the fact that mother had reasonable needs in her home throughout the year. The court also addressed the Krebs issue of duty to disclose, and felt that Krebs did not apply because mother knew she had a right to file to modify, and in fact, mother had filed to modify but withdrew that petition. This appears to create a responsibility of mother to file to modify regardless of personal knowledge regarding income. In light of the holding in Bowser v. Blom, 807 A.2d 830 (Pa. 2002), the case was remanded on the issue of counsel fees under 23 Pa.C.S.A. §4351. Since the Trial Court should not include attorneys fees in the child’s budget, the Court should consider an award of counsel fees to the support petitioner.
III. EMANCIPATION AND SUPPORT
Kotzbauer v. Kotzbauer, 937 A.2d 487, (Pa.Super. 2007), decided November 28, 2007.
The detailed decision of the Superior Court weighed whether the Trial Court should consider support for a 19-year-old daughter who had suffered from epilepsy prior to emancipation. The daughter had had suffered from seizure and undergone brain surgery while she was in high school, and after the fact suffered from seizures. At the time the support action was brought by mother, the daughter was attending community college, however, her grades were very poor and she could not hold a full-time job as she often suffered from severe headaches. The Trial Court found that mother had extraordinary medical expenses for the daughter, and that notwithstanding the daughter attending classes, she required daily supervision. Father sought to rebut the finding of dependency on the basis that the child was healthy enough to attend community college. The Superior Court followed the Trial Court. The trier of fact determined that the child was not yet emancipated, so the Support Guidelines are applicable for an adult child who has a mental or physical condition that prevents the child from earning a support wage.
Style v. Shaub, 2008 WL 3272049 (Pa.Super. 2008), decided August 11, 2008.
The Superior Court considered the legal significance of an unemancipated 18 year old when health problems occurred prior to reaching the usual age of majority. In this case, the support court sent out an administrative termination notice pursuant to Pa.R.C.P. 1910.19(e) notifying mother that if the child was emancipated, the support order would be terminated. Mother did not object to the termination, but thereafter filed a petition for support after emancipation on the basis of the pre-existing condition. The Superior Court noted that a condition that arises after age 18 will not lead to a support obligation, but a pre-existing condition will. Upon careful review of the actual medical issues, the Trial Court had found that the son was employable and therefore should not be considered unemancipated. In the end, the Superior Court relied on the determination by the trier of fact. Although the petition was legitimate, the burden of proof to establish sufficient facts proving dependence had not been met.
IV. PATERNITY AND SUPPORT OBLIGATIONS
Ferguson v. McKiernan, 940 A.2d 1236, (Pa. 2007), decided December 27, 2007.
Mother filed for support and the sperm donor-father protested citing the terms of their written agreement. In this Supreme Court case, on review the justices upheld the contract between sperm donor-father and mother. Although donor-father was not anonymous, the contract was no different from one that would be signed with an institutionally arranged sperm donor. Since this was the basis of the bargain for donor-father to contribute his sperm, he should not be obligated to pay child support when mother decided to renege on the contract. The decision reverses the Superior Court opinion at 855 A.2d 121 (Pa.Super. 2004).
Glover v. Severino, 946 A.2d 710, (Pa.Super. 2008), decided March 27, 2008.
When the baby was born, mother failed to advise Severino that he may not be the child’s father. Severino, operating under the assumption that he was the father, promptly began paying support for the child, until he found out through private paternity testing that he was not the biological father. Mother argued that father was estopped from denying the child was his, and should not be relieved of support; he had been acting as the child’s father. The Supreme Court found that mother committed fraud by omission for failure to tell Severino that he might not be the father. Further, since mother created the fraudulent condition, estoppel should not apply. It was also noted that Severino had never established a close bond with the child, so the estoppel principles should not be invoked.
Vargo v. Schwartz, 940 A.2d 459, (Pa.Super. 2007), decided December 31, 2007.
In this case when the child in question was born, mother and husband were married, however, the Court found that there was no intact family unit. Although husband had held himself out as the girl’s father for a short time, it was determined that the presumption of paternity by a husband should not apply. Later, when mother told husband that he was not the child’s father, husband stopped paying support and argued that he should not be obligated to support a child that was not his. The Court found that a party who is hoodwinked cannot be obligated to pay child support.
Conroy v. Rosenwald, 940 A.2d 409, (Pa.Super. 2007), decided December 28, 2007.
In this case the Court found that paternity by estoppel would not apply. There were two possible fathers and everyone thought dad #1 was sterile. When the baby was born, mom named dad #2 as the child’s parent. Later, dad #2 walked out of the relationship and protested paying support for a child that might not be his. In fact, DNA testing confirmed that dad #2 was excluded. Due to a mutual mistake, everyone was surprised that dad #1 was the father, (and therefore was not sterile). In this case, when dad #1 found that he was the father, he stated that in fact he always thought the child was his. Since the goal of estoppel is to promote fairness, and since dad #1 thought the child was his, he cannot be invoking estoppel to avoid responsibility for payment of child support.
Wieland v. Wieland v. Dillon, 948 A.2d 863, (Pa.Super. 2008), decided May 9, 2008.
The in loco parentis father, (Presley Dillon), failed to successfully raise a claim to paternity by estoppel. The claim was made after DNA testing had been conducted and identified the biological father, not Dillon. At the time mother became pregnant, she was living on and off with the biological father, (her husband). When the baby was born, Dillon was there and was named as the father on the birth certificate. The child was named Presley, nicknamed “Little Pres”. Dillon argued that he and mother raised the child together; in contrast, mother had nothing but bad things to say about father Dillon. Dillon was unaware that mother had sued her husband for support, who demanded genetic testing and got it. After the testing occurred, Dillon sought to intervene in the support case and raise the estoppel issue in his favor. Here the estoppel argument was rejected. The Superior Court decided it would not overturn the support determination as to the biological father and his obligation. Although Dillon would have preferred that the biological father had not been identified, once he had, the stated purpose of estoppel to avoid confusion in the child’s life could not be overcome. The Superior Court specifically stated, however, that the support determination did not preclude Dillon’s custody claims regarding “Little Pres”.
V. OTHER SUPPORT CASES
Faust v. Walker, 945 A.2d 212, (Pa.Super. 2008), decided March 11, 2008.
The Court painstakingly reviewed the proper treatment of a personal injury award proceeds attached to satisfy support arrears. Remember that pursuant to 23 Pa.C.S.A. §4308.1, the recipient of a personal injury award must be reported this to the state in case arrears are owed. The Superior Court found that the right to attach the net award in excess of $5,000 assumes that that award is net of counsel fees and costs. The Trial Court had not made the correct calculation, and the Superior Court clarified that one takes the amount of the award, subtracts the attorneys’ fees and costs, the recipient retains $5,000, and the excess will be attached for support arrears.
J.F. v. D.B., 941 A.2d 718, (Pa.Super. 2008), decided January 3, 2008.
In the novel triplets surrogacy case out of Erie County, the biological father of the triplets challenged gestational mother’s right to receive support and demanded return of support that was paid through the Court. (Gestational mother was not the biological mother.) There was no dispute that gestational mom had received temporary custody and that a child support award had issued. Eventually, it was determined that gestational mother did not have standing to seek custody, and the triplets were returned to their father’s custody. Father sought return of support paid, but the Trial Court and the Superior Court disagreed. De facto custody is sufficient in order to give rise to the duty to support a child. Even though the gestational mother had custody in defiance of the biological father’s wishes, the Support Court and the Superior Court would not order the return of child support paid.
VI. ALIMONY
Kuntz-Mislitski v. Mislitsky, 953 A.2d 847 (Table), (Pa.Super. 2008), decided April 5, 2008.
In a Superior Court decision published in the Pennsylvania Bar Association Family Law Section Summer Meeting, July, 2008, it was noted that the Cumberland County Master recommended alimony $1,200 per month, to continue indefinitely. On Exception, the trial judge awarded alimony of $600 per month for three years. Although the payor complained about the “customary procedure” that this particular Master always orders indefinite alimony, the Superior Court found that wife had no right to rely on that customary practice. There is no alimony guideline. The Trial Court considered the fact that wife had been receiving alimony pendente lite of $632 per month. Wife sought, but received no award of counsel fees. The Superior Court affirmed the decisions of the Trial Court.
Lawson v. Lawson, 940 A.2d 444, (Pa.Super. 2007), decided December 31, 2007.
Notwithstanding a short marriage, (about four years), due to the fact that wife was in very poor health, she was determined to be dependent and a candidate for alimony. In this instance, the wife filed for divorce and thereafter suffered a debilitating stroke. The Trial Court ordered husband to pay gap medical insurance until his former wife became Medicare eligible, and in addition, ordered the payment of $550 per month alimony indefinitely. On appeal, husband argued that publicly-funded care was available. However, the court would not ignore the former husband’s support obligation. The Superior Court affirmed the decision of the Trial Court.
VII. DIVORCE PROCEDURES
Danz. v. Danz, 947 A.2d 750, (Pa.Super. 2008), decided April 16, 2008.
Husband filed for divorce in Potter County, where neither party lived and there was no apparent basis for jurisdiction. A divorce decree issued, and although wife had never filed preliminary objections to the divorce, the decree was reversed on appeal. Because venue was never proper, and there was no affirmative agreement to proceed in Potter County without venue, the Superior Court held that the divorce decree should not have issued from Potter County. It was noted that husband had orally agreed on April 10 in a conference with wife and the attorneys that he would withdrawal the divorce action. In fact, the divorce issued 17 days later, and wife promptly filed to vacate the decree. The Superior Court agreed with wife.
VIII. EQUITABLE DISTRIBUTION
Prol v. Prol, 935 A.2d 547, (Pa.Super. 2007), decided October 18, 2007.
It is the bane of the existence of many former spouses to suffer from the delay in the entry of a Qualified Domestic Relations Order. In this case, it had been five years from the divorce decree, and the QDRO had not yet issued. There had been a series of Orders directing wife to prepare a QDRO that was satisfactory to husband. Apparently, an order was prepared. There was an issue as to whether husband was satisfied with it, and as to whether the plan administrator would approve it. Ultimately, the Chester County judge determined that due to the inordinate delay, the former wife would forfeit her pension award (58% of husband’s marital pension). On appeal, the decision was reversed. The Superior Court found that husband failed to demonstrate that there was an incurable prejudice caused by the delay, and felt that forfeiture of her equitable distribution rights was excessive and inappropriate.
Bold v. Bold, 939 A.2d 892, (Pa.Super. 2007), decided December 4, 2007.
The Superior Court reversed a finding of contempt where wife’s repayment of a loan was arguably a violation of a stipulation prohibiting the use of business assets for personal expenses. On appeal, it was determined that the loan was a legitimate obligation, and payment of the loan did not constitute using business assets for personal expenses. The finding of contempt was reversed.
Taper v. Taper, 939 A.2d 969, (Pa.Super. 2007), decided December 26, 2007.
In this case divorce grounds had been established, and the Master had conducted evidentiary hearings; the Master had issued one report; arguments were made, and the Master issued a second report. After the second report issued, husband died. Wife then protested the issuance of the second report and asked the Master to revise his recommendations. The Master declined to do so. The Trial Court had the authority to approve or amend the Master’s recommendation, and decided to issue a decree in divorce and approve the Master’s recommendations. Although the Trial Court did not have a right to issue a posthumous decree, the amendments to the Divorce Code specifically allowed the issuance of an equitable distribution award. Grounds had been established prior to the Master’s hearing. The decree was reversed, but the equitable distribution and economic rulings by the Trial Court were affirmed.
Smith v. Smith, 938 A.2d 246, (Pa. 2007), decided December 27, 2007.
The Supreme Court reversed the decision of the Superior Court determining of the marital portion of the husband’s pension. This was a case in which after the parties separated, legislation issued that changed the definition of pension benefits for husband. The Supreme Court found these to be post-separation enhancements that were received by husband without any personal effort or post-separation contribution. Under these circumstances, the Supreme Court found that the increase in the value would be assigned to the marital portion. Husband received the enhancement simply by being a former employee. Interpreting 23 Pa.C.S.A. §3501(c), the Supreme Court found that the marital pension included all post-separation enhancements that were not caused by post-separation contribution or effort.
IX. AGREEMENTS
Annechino v. Joire, 946 A.2d 121, (Pa.Super. 2008), decided March 26, 2008.
A divorce agreement is enforceable by the court even though neither equitable distribution nor incorporation of an agreement was pled in the divorce action. After the divorce issued, the parties’ private agreement was submitted to the Court for enforcement. The Superior Court confirmed that pursuant to 23 Pa.C.S. §3105, it was the legislative intent that the ability to enforce an agreement should be broadly interpreted. Therefore, under the Divorce Code, one could seek to enforce a property settlement agreement which had never been filed with the court, and was not contemplated in the divorce pleadings or final decree.
X. MISCELLANEOUS ISSUES
IRS Revenue Procedure 2008-48. Please review this procedure carefully, which clarifies that the custodial parent cannot be ordered to forfeit the dependency exemption by the support court. The dependency exemption can be released by the custodial parent, only by the execution of a document as required by the Internal Revenue Code.
Bogus Marriages. There was a lot of press in 2007 regarding ministers who were ordained “on-line” in a bogus religion were marrying folks without authority. Since common law marriage is no longer recognized in the state of Pennsylvania, and those bogus ministers did not have the legal authority to marry people, those purported marriages were never valid. Although annulment will lead to economic rights under the Divorce Code, other rights that require that you be married, (Social Security, dependency benefits, etc.), will not apply if there is no legitimate minister and marriage license.
X. PROPOSED AMENDMENTS TO THE SUPPORT GUIDELINES
Attached are the proposed Amendments to the Support Guidelines subject to review and comment by October 31, 2008. The threshold for Guideline support has risen to combined net income of $30,000 per month. The support obligation for those above that level seems is at a significantly lower rate than the support obligation for the folks at the $30,000 mark. This has been a bone of contention by those protesting the Guideline amendments. It is well recognized that many judges have called for avoiding all Melzer- -type analysis of expenses. Isn’t a Melzer analysis justifiable with the very high income folks who net more than $30,000 per month? Interestingly, there is still a formula for spousal support that seems somewhat favorable to the dependent spouses. Once comments are collected, the Rules Committee will issue a report to the Supreme Court. The Supreme Court will review the proposed Amendments and the comments. That could take weeks or months. Once the Amendments are approved in whatever form the Supreme Court deems appropriate, the new Rules will issue. Almost every case will be subject for review for adjustment under the new Guidelines. |
